How to Save 1000 Dollars 

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It can be so hard to save so we thought we would help with how to save 1000 dollars. Whether you’re looking to save $1000 with some extra work or find a way to save it right from your income, this article can help you!

Whatever your reason for saving 1000 dollars, we’re on board! It’s important to have a financial cushion to fall back on. Many Americans do not have the savings to cover a big emergency. If you’re ready to save $1000 then let’s dive in!

Assess Your Finances

The first step in how to save 1000 dollars is to assess your finances. Do you already have money you can set aside each month? Do you think you need to make some extra money to meet this goal? Are there areas you can cut back on to fund your savings?

Understanding and knowing your income and expenses allows you to identify how much you have each month to save, and whether you need to boost those savings to meet your target. 

Set Your Savings Goal

You’re here because you want to know how to save 1000 dollars. We already know that’s a savings goal. Let’s break it down further.

It’s important to have a savings goal because it gives you something to work towards. If you said I’m going to give myself twenty years to save $1000 would you start saving now? Not likely. In ten years? Probably not. 

Give yourself a reasonable time for your savings goal. Knowing and understanding your finances as we recommend in step one can really help with this. Is it feasible to save the money in one year? Are you willing to pick up a second job to make this happen in a couple of months? These are all questions you need to answer prior to starting saving. 

Set yourself a time frame (and if you need to, break it down into smaller chunks for encouragement. $100 a month seems more reasonable than $1000 in ten months, even though it’s the same goal. Be realistic.

Decide Where to Keep Your Money 

It’s important to know where to put the $1,000 as you save it. This will be based on your goals for the money. Money saved for emergencies needs to be easily accessible. $1000 saved for a purchase in 5 years can be put into a longer term account. Let’s look at some options.

1. High Yield Savings Account – Usually found at online banks, HYSA’s are the best choice for saving money that you may need to access at any time. Right now, interest rates at many banks are over 5%. Regular savings accounts are around .05%. Do you see the big difference? $1,000 at 5% gets you an extra $50, but $1,000 at .05% gets you $0.50. I think the choice is clear
2. Money Market Fund – A money market fund is like a savings account, but your money is invested in low-risk market funds. Many banks, mutual funds and brokerage firms offer Money Market Funds. The rates tend to mirror high yield savings accounts, but can vary and are not guaranteed. They tend to change with the market. 
3. Bonds – A bond is basically a loan you can give to a company, or government entity (municipal, state and federal). You then receive interest for the life of the bond based on a specific time period and set interest rate. Since you are trying to save $1000, look for bonds that can be bought for a low amount and don’t have long terms. You don’t want to buy a 30 year bond unless that’s how long it will be until you need the money! Bonds are a very safe investment. The return may be lower, but if you will need the money within a couple of years, it is best to be safe so you will not lose any of your hard earned cash.
4. Brokerage Account – This can be risky, and is not recommended for short term savings. With a brokerage account, you can invest and buy into a variety of investments, including stocks and bonds. This can be a great place to store your money, especially as the market rises. It can also be risky. If the market is going down, and you need your money, you may find yourself shy of your $1,000.
5. Piggy Bank – Okay, it doesn’t have to be an actual piggy bank. Some people, however, prefer to keep their cash nice and save at home. While I’d still recommend choosing one of the other accounts so you can make some interest, if this is the method you prefer, go for it! You can make it fun by getting a piggy bank that you actually have to break open once your money is saved, and have a smashing ceremony! I would also only recommend keeping the money at home if you can guarantee you will not spend it.

Check out our article on Where Can I Save My Money?

Review Your Finances and Cut Unnecessary Expenses

One of the best ways to start saving money is with the income you already have. Finding out places to trim back on discretionary, non-essential spending can add up quickly when those funds are redirected to your savings. 

One of my favorite methods on how to save 1000 dollars is what I call the “I didn’t buy it but I could have so that money must go to savings” method. It’s a long name, but it’s what I tell myself every time I don’t buy something. For example, the other day I wanted to buy a new hairbrush. Why? Because it looked cool and was on sale. I even added it to my cart for $14.99. Did I need it? No.

With immense willpower I was able to remind myself that I did not need the brush, as the one I own functions perfectly fine. I could have easily afforded the brush. After I talked myself out of it, I went to my bank account and transferred the $15 to my savings account. I do things like this a lot. It helps me cut back on my spending every month, and those savings add up quick. 

I only do this, if I could have actually afforded the item out of my spending money. You do not want to try this savings method if it is going to pull out too much money and you won’t be able to afford basic needs such as housing and food. 

Don’t like this idea? Look for other cutbacks. Maybe cancel an unused gym membership and allocate $20 to your savings every month, or skip one (just one, relax) expensive Starbucks drink a week and put that $5 toward your savings. You’ll be amazed how quickly things can add up to $1,000.

Earn Extra Income

Are you looking at how to save 1000 dollars a little bit quicker? The best way to do that is to find some cash above and beyond your current income. When looking at how much you can save each month, you may find that it could take a year or longer to save $1000, even with cutting back on expenses. The best way to boost your savings quickly is to find some extra money. If you’re looking to save $1000 sooner, rather than later, I wouldn’t try a long-term method such as starting a business. Here are some things you can do now that will help add up to that $1000 quick:

1. Dog sitting- people are always looking for someone to help take care of their pets. Whether they are going on vacation, or need a walker while they are at work, people pay pretty well for the care of their beloved animal. Check out popular sites like Rover, or Craigslist
2. Get a part time job- many businesses are seeing a staff shortage. Now is a good time to find some part time work to help save that money up. Check out what’s available near you, and see if anything can fit in your schedule.
3. Odd jobs- look for small, random jobs on Craigslist, TaskRabbit or in your local community boards. People always need help with things like moving, yard work, etc. I know someone that got paid $50 to help move a refrigerator. It took them less than an hour, too!

There are so many more ways to make extra money. Get creative. Check out your local listings. Some people post for help on pin boards at businesses. You never know when the opportunity will crop up to make extra money.

Check out our article 13 Ideas for Side Income for more suggestions!

Automate Savings

Set it and forget it is absolutely one of the most efficient savings methods. By taking out the physical action of having to save, you are removing the money from your hands altogether. If you really want to know how to save 1000 dollars, this is one of the most efficient ways to do it. When money goes straight from your check to a savings account, you never see it, and thus are less likely to spend it. 

I highly recommend opening a savings account that is separate from your other accounts (I love to use Vio, a bank with a high yield savings account). If you can do direct deposit with your employer, set it up so money goes into this account from each check. If your employer does not allow this, set up a bank transfer from you checking to your savings every pay day.

Use Trackers for Saving

Another great way that I’ve learned how to save 1000 dollars is to make it fun! I use savings trackers to make savings more colorful and exciting.

What is a savings tracker? In the form of either a printout, or through an Excel spreadsheet, it’s a tracker where you break your goal down into smaller amounts and color in an area once you reach that amount. 

For example, you might have a sheet with 10 piggy banks on it. Each time you save $100, you fill in a pig. 

Small actions like this encourage us to keep pushing and trying for the next goal. They are a visual representation of our progress, and a good reminder of the hard work we put towards our goals. It’s a great way to get the kids involved too!

Keep Motivated

Stay motivated and stay consistent. Use trackers, get support from others, and remind yourself why you are saving. It is important to stay focused on your goals.

When learning how to save 1000 dollars, you may find it helpful to let others know what you are doing. Friends and family can be a great support source. My friend likes to ask me things such as ‘do you really need that shirt, or would you rather save the money?’ Questions like that can make you hesitate on a purchase you would have otherwise made without thought. 

If you ultimately decide you want the shirt, that’s okay! Just shifting your mindset to really think about what you are spending and what you are saving is key.

Stay consistent with your savings efforts. Once you develop a steady, regular savings plan, your $1000 will be saved up in no time.

Celebrate Your Savings Successes

I have a friend that I text at certain increments of success. Celebrating does not have to be expensive. The “woohoo!” I received in response makes me smile and encourages me to keep saving.

Celebration can be found in all forms. Share on social media, let your family know, and if it is in your financial plan, buy yourself something small. Maybe at the $500 mark you treat yourself to a cupcake, or that budget tracker you’ve been eyeing up. 

The point is, it’s important to celebrate and remind ourselves of our successes. It isn’t easy to save $100 let alone $1000. Make sure to take time to celebrate all the milestones, big and small.

Conclusion

Do you have enough information to start saving yet? Get started now on your journey to save $1000. The best method on how to save 1000 dollars is to start with yourself, your situation, and go from there. Check out your finances, give yourself a time goal, get yourself set up, and get saving.